Tag Archives: Berkeley

Win, Win, Win

I discovered yesterday the new 2008 Academic Ranking of World Universities done by the Institute of Higher Education, Shanghai Jiao Tong University (IHE-SJTU). Again the USA has the lion share: 8 in the top 10 and 17 in the top 20. Only the UK (Cambridge and Oxford) and Japan (Tokyo) enter the list. You can assess the ranking in more details with the full 500 ranking if you wish.

When I published “Start-Up”, I had a conversation with Christophe Alix, a journalist at Libération who told me that I forgot one thing in my explanations of the US superiority in innovation, i.e. the huge budget of the Pentagon. I certainly do not disagree and address the issue further below with a book I am just reading:


“Creating the Cold War University- The Transformation of Stanford” by Rebecca S. Lowen is an interesting book about how Stanford became wealthy in the 50’s and the 60’s thanks to federal money and industry contracts. Frederick Terman, often credited as being the father of Silicon Valley, called it a “Win-Win-Win” situation. The government funded basic and applied research (the difference between the two was often fuzzy) to develop military applications during the Cold War, the industry developed the products from the results of the research (and did not always have to directly fund the research), and companies like H-P, Varian, GE benefited greatly the effort. Finally Stanford became wealthy as well as excellent in research (which it was not in the 30’s).

Lowen explains that “by 1960, the federal government was spending close to $1B for academic research and university-affiliated research centers, 79 percent of which went to just twenty universities, including Stanford, Berkeley, Caltech, MIT, Harvard and the University of Michigan” (page147). In the Shanghai ranking, Harvard is #1, Stanford is #2, Berkeley is #3, MIT is #5, Caltech is #6 and Michigan #18 only.

Money definitely helps. I had however reacted against Alix’ argument as military money can not explain by itself the entrepreneurial spirit that Boston and Silicon Valley developed. Caltech and its JPL laboratory never reached the same start-up activity. But the quality of universities and their wealth is an extremely strong ingredient for successful technology clusters.

EDA, an industry from Silicon Valley

Penny Aycinena asked me to write a short article in EDA confidential, which summarizes my concerns and hopes about innovation and start-ups. It is published today (June 30, 2008).


Let me add more here:

The chapter of “Start-Up” which has been the least noticed is Chapter 6. It is one of my favourites though. It is about EDA, which stands for Electronic Design Automation. Today, no architect would design a complex building without software, nor would an automobile engineer. It is exactly the same with digital circuits.

Twenty five years ago, EDA was nearly non-existent. Forty years ago, chips were designed internally (and manually) at IBM, Motorola… and little by little, some new players emerged, tiny start-ups became big and an industry was born. It was more than $5B in revenues in 2007. The typical ebb and flow of start-up creation and acquisition went on for two decades. But since 2001, not much has happened: no IPO, small M&A deals and a few days ago, Cadence, the biggest EDA vendor, announced a hostile acquisition bid against Mentor, the number 3 player. Both companies were founded in the 80s.


EDA is a good illustration of what Silicon Valley is: a rich network of individuals, academics, entrepreneurs, investors. What is interesting about EDA is that its center is probably Berkeley (rather than Stanford or Sand Hill Road) as the picture below shows. Let me quote again two legends of the EDA field, two recipients of the Kaufman award, the Nobel Prize of EDA:

– “Risk taking in EDA is gone.” Joe Costello

– “If there is a single point I wish to make here today, it is that as a discipline, both in industry and in academia, we are just not taking enough risks today.” Richard Newton

It could be that the maturity of EDA and of Silicon Valley is not such a good sign.